Don't cash in that gold ring just yet

CBS.MarketWatch.com

LOS ANGELES (CBS.MW) -- I don?t know about you, but every time I look at my jewelry box, it reminds me of my days in grade school. Junk to keep. Junk to throw away.

Jennifer Openshaw

I don?t think much about my gold jewelry, but veteran gold and estate jewelry expert James Gersten says I should.

"We often forget that old scrap gold laying in a drawer is worth something," he points out.

Worth something even this week, when the price of gold sustained its biggest one-day drop in two years? It fell $10.10 to $288.90 an ounce on just one day -- a far cry from the go-go '80s, when the price hovered at around $800 an ounce.

Matt Westfall, a gold trader at the National Gold Exchange, calls the price drop "horrible."

"Unless you need the money, there?s really no upside to selling your jewelry," he says

Even stocks of gold-mining companies such as Freeport-McMoran
FCX, -2.29%
and Battle Mountain
BMG, -7.14%
have taken a beating this week, due largely to a slowdown in demand for gold in Asia.

What?s a girl to do?

So, what?s a girl to do? If you?re looking to cash in based on the pure value of the gold, forget it. At today?s gold prices, one ounce of 14-karat gold would only fetch about $174. You?re better off waiting for prices to go up -- unless you have taxes to pay or holiday gifts to buy. That?s when Gersten sees most people trading in scrap gold. Or better yet, you might give that old piece of jewelry to a favorite niece who may well treasure the gift -- and your relationship.

But Gersten reminds us that it isn?t just the price of gold that determines what you can get for a piece of jewelry. Vintage jewelry or jewelry made with white gold is popular these days, prompting jewelers to pay top dollar.

"A tiny ring with $50 of gold could be worth $100 simply because it?s a vintage piece," says Gersten.

The platinum test

Selling jewelry is one thing. Trying to decipher white gold from the more expensive platinum is another. White gold lacks the copper and instead is alloyed with silver and nickel -- hence the light color. The much heavier and denser platinum requires higher temperatures to melt. In the 1920s and 1930s, when the price of platinum was out of reach for most, people turned to white gold as a substitute.

"White gold was the poor man?s platinum in the art deco days of the early 1900s," says Gersten. "That?s why today, we see fewer pieces made in platinum, and so there?s an even greater premium on them."

Figuring out what you really have sometimes requires a trip to the jeweler. Getting a few opinions and shopping around for the best price is smart before you sell something.

The case for jewelry boxes

Don?t forget that your jewelry?s physical shape will also determine its price. Jewelers often look more at the chances of reselling the item based on its look than on its gold value. Damaged items will cost you anywhere from 20 to 30 percent in value, says Gersten.

If you?re disappointed about today?s low gold prices, don?t despair.

"Everyone and their brother is trying to buy gold because it?s so cheap," says Westfall.

A piece of jewelry today would have cost you two to three times that amount some 15 years ago. With the holidays coming up, that may mean a gold bracelet or necklace is just the perfect gift to buy your daughter or mother.

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